Fino Payments Bank is intensifying its focus on digital banking to drive growth, aiming to capitalize on the market opportunity created by the departure of Paytm Payments Bank, previously a dominant player in the segment.
The bank plans to significantly increase its revenue from digital banking, targeting around 15% of its revenue for the fiscal year, up from 5-6% in FY24, according to CEO Rishi Gupta.
With Paytm’s exit, Fino anticipates a surge in demand for quick digital credit and Unified Payments Interface (UPI)-based transactions, aiming to enhance its market share. Currently, approximately 1.5% of UPI payments are processed through Fino’s platform.
Gupta highlighted the bank’s investments in building its own in-house UPI settlement capabilities and implementing an offline QR code-based payment strategy, which can be utilized across its network of 1.8 million merchants.
Since December, Fino has deployed around 14,000 QR codes, facilitating 300,000 transactions valued at Rs 33 crore.
Transitioning from primarily physical business, Fino processed 5-6% of its total revenue through digital channels in the last fiscal year. The management targets an overall revenue growth of over 20% for FY25.
Competitors such as Airtel and Jio Payments Bank are also eyeing the digital banking space, leveraging the distribution networks of their parent companies.
In December, BSE-listed Fino applied to the Reserve Bank of India to convert into a Small Finance Bank (SFB), aiming to expand its range of banking products and services.
With an SFB license, Fino plans to enhance its current and savings account offerings, introduce fixed deposits and recurring deposits, and enhance its customer base.
Fino currently boasts more than 10 million active customers, with approximately 40% digitally active.
The bank is exploring opportunities to offer small-ticket merchant loans and products in high demand among its user base, including business and two-wheeler loans.
In addition to consumer-focused services, Fino is developing strategies for business-facing functionalities, aiming to partner with entities for payments, credit sourcing, and cash management.
Fino posted a 20% increase in total income in FY24, reaching Rs 1,478 crore, with net profit rising 33% to Rs 86.2 crore
